UFI Open Seminar in Europe 2010 - Budapest - Juan Rigall

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N E W B U S I N E S S I D E A S -H O W TO C H A N G E YO U R B U S I N E S S

UFI Open Seminar in Europe

Budapest, June 23nd 2010

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UFI Open Seminar Europe100623_UFI Open Seminar final1

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Agenda

Innovation in times of crisis - a vital case?

What is innovation?

Major trends in innovation management?

How to change your business sustainably?

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How to capitalize on globally recovering markets

Perceived development(Western hemisphere)

What makes the difference?

Our performance is dependant on

the (macro-)economic development

individual best-in-class operational performance

active driving of consolidation and cooperation

our individual growth performance on top of all that

What generates the highest growth in profitability?

2008 2009 2012

Scenario 3

Scenario 2

Scenario 1

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Recent global studies reiterate on the importance of innovation

Handelsblatt Management Forum Main outcome

Worldwide leading business schoolspredict and evaluate future trends

Americas

Europe

Asia

1. Innovation, innovation,innovation

2. Penetrate upcoming regionsSouth America,Africa

1. Restructuring the owneconomy

2. Re-invent yourself - innovativebusiness models

1. Encounter growth potentials inhome region

2. Innovate and conquer techno-logy leading position

Innovation is main focus to generate growth in developed markets

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Innovation - a simple definition

old new

old

new

Regions,Customers,

etc

Formats (shows,conferences,etc.)

New formats

New customers

New regions

Innovation - a new business generating overproportional profits

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Trade fair industry‘s executives focus on hurdles for innovation

Typical statements towards innovation Conceptual cornerstones

„95% of the market is set nowadays.We are only growing throughacquisition of new formats and that means crowding out, not growing.“

„I have not seen a real innovation in the last 10 years.“

„Do not knock on my door with a new business idea of less than4.000 sqm.“

Strategic ambition

Business model

Structures

„ Motivation is the problem - uncertain long-term success vs. current sqmsold is an unfair comparison.“

„I am always preaching in favor of new business but my people are notcreative enough.“

„I do not know what we spent for the new business development butperceived outcome is low.“

Motivation

Qualification

Steering

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To generate new business ideas you need a conceptual grid

Holistic approach

Stra-tegy

Businessmodel

Structures

Motivation

Qualification

Steering KPI & monitoring

Creativity & entrepreneurship

Internal awards

Flexible structures

Business model lab

Beyond barriers strategy development

Interdependent cascade of requirements

Concept

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Give guidance towards role and importance of new businesses

State-of-the-art concept Potential implications trade fair industry

Define vision of your business in 5 years time

Position business in the future growth grid

Ascribe the potential value contribution of newbusinesses to the overall company performance

Translate your strategic ambition concerning innovationinto a strategic plan

The relation between traditional and new businessmust be clear as well as “the rules of the game”(internal competition, expected business impact etc.)

A quantified strategic ambition has to be communi-cated personally to give guidance to the wholeorganization

Regular updates on strategic development safeguardfocus and momentum through continuous reiteration

Strategic ambition

Industry examples

Automotive industry

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Simulate new business ideas intensively


Simulate impact of new business models in“laboratories” to avoid costly failures

Train your teams on new markets requirements andfocus competitive and customer added-value

Capitalize on newest methods and other industries’experiences (e.g. hightec, IT, pharmaceutical, auto-motive industry)

Own insecurity about new business models and theirvalue generation does not save management to ignorepotentials of other businesses (merchandising, eventmanagement, etc.)

Apply open minded teams with good mix between fact-driven and out-of-the-box to assess business potential

Define evaluation grid beforehand without perpetuatingthe existing business and success requirements

Business model lab

Industry examples

IT industry

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The more innovative the more separate


If new businesses promote new business models orare perceived as internal competition, structuralseparation is key

Organization must allow for other external parties(investors, universities, etc.) to adhere easily (openinnovation)

Internal cannibalism is most frequent reason for failureof new businesses

New businesses must deliver significant returns long-term. Otherwise, internal balance at risk

Success stories must be communicated intensively.Internal migration from traditional to new businessesand vice versa should be allowed

Flexible structures

Organizer

Infra-structure

Inter-national

Admin.New

venturesFairsFairs

New businessdevelopment

Industry examples

Consumer goods

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Internal awarding mobilizes the entire organization


Utilize the innovative power of your wholeorganization

Go beyond the New Business department

Build-up mixed teams that work-out selected ideas

Make strategic rationale and business case sketchmandatory

Reward winning teams and communicate intensively

Innovation goes beyond a certain department or justthe management team

Emphasis on new business idea generation is laid uponthe organization across all functions

Joint team work as well as being allowed to think out-of-the-box motivates people

Keeping an eye on profit generation potential shouldnot imply any limitation towards size, scope, etc.

Internal innovation awards

Industry examples

Pharmaceutical industry

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Invest in your people


Help your organization to question currentproceedings and ways of making business

Train them to listen and derive business opportunitiesfrom multitude of contacts

Show them variety of potential business models

Creativity can not be imposed but creativity techniquescan be trained

Existing contact base to various industries mainsounding board to discuss creative new approaches

Decentral entrepreneurship has to be fostered togenerate sustainable development of new businessesCreativity and entrepreneurship

Industry examples

Pharmaceutical industry

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Measure closely to provide transparency on innovative performance


Define the main metrics to measure new businesssuccess

Make them integral part of target agreement process

Monitor the impact on single KPIs closely and definemeasures

Communicate the importance of KPIs and the waythey work

Key ratios like sales contribution of young formats (lessthan 3 years) to be defined

Margin and volume contribution to be closelymonitored

Clear break-up rules if new ventures do not meetexpectations

Integrate KPIs into your reporting system to providedecision making capabilities “at your fingertips”

KPIs & monitoring

Industry examples

Semiconductor technology

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Summary

Cornerstones Findings trade fair industry

KPI & monitoring

Creativity &entrepreneurship

Internal awards

Flexible structures

Business model lab

Beyond barriersstrategy development

“You have to create room for innovative thinking andgive strategic guidance”

“You have to breed new business with a strong profitfocus”

“You have to separate embryonic businesses frommainstream”

“You have to campaign for innovative behaviorinternally”

“You have to train people on creativity andentrepreneurship”

“You have to closely balance investment andrespective outcome”

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